SF: Copper Rises Most in Month as Equity Gains Boost Risk Appetite
Aug. 26 (Bloomberg) -- Copper rose the most in a month as equity markets rebounded, boosting investors' appetite for riskier assets including the industrial metal.
The MSCI World Index of shares advanced for the first time in six sessions following a bigger-than-forecast drop in U.S. jobless claims. The dollar fell as much as 0.8 percent against a basket of six major currencies, as demand for a haven eased. The Reuters/Jefferies CRB Index of 19 raw materials rebounded from a six-session slump.
Today's trading is "dominated by macro releases out of the U.S. with weekly initial claims figuring most prominently," Edward Meir, an analyst at MF Global Holdings Ltd. in Darien, Connecticut, said today in a report.
Copper futures for December delivery rose 8.45 cents, or 2.6 percent, to $3.316 a pound at 10:39 a.m. on the Comex in New York. A close at that price would mark the biggest gain for a most-active contract since July 21.
Yesterday, the metal closed above the 200-day moving average of $3.2213, after touching $3.20, the lowest level July 28. This is a "significant" price action that "attracted follow-through buying overnight out of China and India," Alex Heath, the head of London Metal Exchange trading at RBC Capital Markets, said in a daily report.
"The bounce will have more to go," especially if tomorrow's readings on the U.S. economy "don't blindside investors by coming in worse than expected," MF Global's Meir said.
A report from the Commerce Department may show gross domestic product grew at 1.4 percent in the second quarter, rather than the 2.4 percent annual rate calculated last month, according to the median forecast in a Bloomberg survey of 81 economists.
Copper for delivery in three months jumped $170, or 2.4 percent, to $7,271 a metric ton ($3.30 a pound) on the LME. Aluminum, zinc, lead, tin and nickel also gained.
